Iran’s top security chief Mohsen Rezaei announced on Sunday that the country will establish a ‘prohibited zone’ near the Strait of Hormuz within days, according to state media. The move follows recent US military strikes on Iranian targets in the Gulf region and comes as Tehran raises domestic fuel prices in response to economic pressure from Western sanctions.
Rezaei stated that the prohibited zone would extend from the US Navy’s blockade line into parts of the Persian Gulf, with any vessel entering the area facing inclusion on Iran’s sanctions list. The announcement coincides with a doubling of Iran’s highest-tier gasoline price from 5,000 to 10,000 tomans per liter (approximately 4.5 US cents per liter), effective September 8. Government spokeswoman Fatemeh Mohajerani attributed the price increase to President Hassan Rouhani’s prior commitments to adjust fuel costs, though she noted internal debates over the final rate.
-- Immediate Escalation in the Gulf --
The declaration follows a week of intensified hostilities between the US and Iran, including multiple strikes on Iranian oil tankers and retaliatory actions by Tehran. On Saturday, Iran’s Revolutionary Guard Corps claimed to have targeted a US naval drone, three oil tankers in the Strait of Hormuz, and US vessels elsewhere, while the US military reported disabling two Iranian tankers off Kharg Island and destroying an unladen crude tanker in the Sea of Oman. US Central Command (CENTCOM) stated its forces had successfully evaded Iranian attacks.
Iranian negotiator Mohammad Baqer Qalibaf warned that the era of proportional responses had ended, vowing ‘faster, more intense, and more painful’ retaliation against any aggression targeting Iranian interests. Qalibaf’s remarks followed the expiration of a 60-day ceasefire in August, which had briefly paused the conflict that began in February. The fighting has since spread to multiple regional states, including the United Arab Emirates, Bahrain, Kuwait, and Jordan.
-- Economic and Strategic Implications --
The closure of the Strait of Hormuz—through which one-fifth of global oil and liquefied natural gas previously passed—has driven oil prices to multi-month highs. Brent crude closed at $95.52 per barrel on Friday, up from $72.48 the day before the war began. In the US, gasoline prices have surged, with the average diesel price reaching $5.85 per gallon on Friday, according to reports. US Energy Secretary Chris Wright attributed recent price declines to seasonal demand shifts but acknowledged the conflict’s role in sustaining elevated costs.
The Trump administration has framed the economic strain as a central issue ahead of the November midterm elections, with President Donald Trump asserting that a recent deal to secure Venezuelan oil reserves and relaxed refinery regulations would help lower prices. Analysts caution, however, that the impact may be gradual given Venezuela’s constrained oil infrastructure.
-- Diplomatic Fallout and Regional Shifts --
The conflict has also strained Oman’s traditionally neutral stance. Reports indicate that Muscat secretly negotiated the Iran-Oman Joint Transit Corridor Accord, a framework allowing commercial vessels to transit exclusively through Iranian territorial waters in exchange for toll revenue sharing. The US condemned the deal as a violation of international norms, warning that financial complicity with Iran could result in total isolation from Western financial systems. Following the accord’s leak, the US launched aerial bombardments targeting Iranian threats to commercial shipping, escalating the conflict from economic to kinetic terms.
-- Military and Rhetorical Posturing --
US Defense Secretary Pete Hegseth reiterated Washington’s stance on social media, stating, ‘If Iran shoots at US ships, we will destroy (and sink) their oil tankers.’ CENTCOM spokesperson Captain Tim Hawkins denied Iranian claims that a US remote-controlled vessel had been attacked near the strait, calling the report ‘a total lie.’ Meanwhile, Iranian officials have framed their actions as defensive measures against what they describe as an illegal US blockade.
President Trump has suggested the renewed fighting would not persist ‘too long,’ echoing earlier assurances that the six-month-old war remains containable. However, diplomats report no progress toward a lasting settlement, with both sides continuing to assert control over the strategically vital waterway.